The USD/CAD has been following an uptrend in the last week of February and the beginning of March. It looks like the trend came to an end. Last week, buyers broke the resistance area at 1.2920 and pushed to 1.30.
We were following this pair and its levels and posted a couple of forex updates if you recall. Buyers failed to break the 1.30 level after three attempts then price returned down.
Is the retrace up over?
The USD/CAD closed the week with 200 PIPs lower at 1.28. Switching to the weekly chart, you will see an upside down hammer candlestick, a reversing signal.
This week, the USD/CAD has been pressing higher, albeit pretty slowly. It seems like this slow move higher is just a retrace of last week’s downtrend if we consider it such. Right now, the price has reached the 20 SMA (grey) and the stochastic indicator is overbought thus the retrace up should be over.
This looks like a good opportunity to open a forex sell signal, which we might do soon. We also have the 50 SMA (yellow) standing 20 PIPs above, another defence line for sellers if the price moves above the 20 SMA.